There are six major types of bankruptcy, but the most common is liquidation or straight bankruptcy. This is also known as Chapter 7, and some Kentucky residents understand it through negative connotations. However, it is important to understand what a Chapter 7 filing constitutes, and what it means for the future financial health of an individual or family.
If your creditors are suing you, it is a very serious situation indeed. You will need to take immediate action if you wish to stop the proceedings.
In 2017, fewer than 500,000 Americans filed for bankruptcy. This is concerning to some financial analysts who believe many people, both here in Kentucky and elsewhere in the nation, would benefit greatly from a Chapter 7 bankruptcy filing. Unfortunately, misinformation and fear can cause some to shy away from a valid and valuable financial solution to overwhelming debt. Thankfully, this can be addressed through education.
Any bankruptcy filing is intended to relieve debt issues, be it for an individual, a household or a business. The two prevailing types of consumer bankruptcy are Chapter 7 and Chapter 13, both of which are used by individuals and families here in Kentucky and elsewhere in the nation to handle debt that has become insurmountable. It is important to understand the distinctions between the two in order to determine which route is best for an individual's situation.
In 2005, Congress changed details in the U.S. Bankruptcy Code, which some financial experts believe was an attempt to bar the way for some consumers to file for bankruptcy. Here in Kentucky and elsewhere in the nation, the value of Chapter 7 bankruptcy cannot be overstated for individuals, families and businesses facing serious debt. However, it is important for anyone thinking of filing to understand the criteria for qualification.